EX-10.12






Exhibit 10.12




EBG HOLDINGS LLC

The Schrafft Center

529 Main Street, Suite 605

Charlestown, MA 02129




May 31, 2007




Astoria Generating Company Holdings, L.L.C.

c/o US Power Generating Company, LLC

505 Fifth Avenue, 21st Floor

New York, New York 10017

Attention: Chief Executive Officer




Dear Sir:




     We refer to the Agreement and Plan of Merger (the “Merger Agreement”), dated as of
February 28, 2007, among US Power Generating Company, a Delaware corporation
(“USPowerGenCo”), EBG Holdings LLC, a Delaware limited liability company (“EBG”)
EBG Merger LLC, a Delaware limited liability company, Astoria Generating Company Holdings, L.L.C.,
a Delaware limited liability company (“Astoria”), and Astoria Merger LLC, a Delaware
limited liability company. Capitalized terms not defined herein have the meanings assigned to them
in the Merger Agreement.



     This letter agreement confirms our agreement that:



     (1) The first sentence of Section 1.7(a) of the Merger Agreement shall be amended in its
entirety by inserting the following text in lieu thereof:




“From and after the Effective Time, the individuals set forth on Exhibit D-l hereto shall be
the directors of USPowerGenCo until their successors shall have been duly elected or appointed
and qualified or until their earlier death, resignation or removal in accordance with the
applicable Organizational Documents.”



     (2) Section 9. l(a) of the Merger Agreement shall be amended in its entirety by inserting the
following text in lieu thereof:




“9.1 (a) Except as otherwise specifically provided for in this Agreement, EBG and its
Subsidiaries party hereto, on the one hand, and Astoria, on the other hand, shall bear their
respective expenses, costs and fees (including attorneys’ and auditors’ expenses, costs and
fees, if any) in connection with the transactions contemplated hereby, including the
preparation, execution and delivery of this Agreement and compliance herewith;
provided that Astoria and EBG shall share equally all filing fees in connection with
the filings required by the HSR Act; provided, further, that, if the
Mergers are effected, USPowerGenCo and/or



 









 






Astoria shall pay all such expenses, costs and fees of EBG (including without limitation the
fees and expenses set forth on Exhibit I hereto) and Astoria, subject to the terms and
conditions hereof; provided, further, that (i) in no event shall USPowerGenCo
and/or Astoria pay in the aggregate in excess of $25,000,000 of such expenses, costs and fees
of EBG and (ii) in no event shall the transaction fees and transaction bonuses of Astoria
(including amounts payable to Affiliates of Astoria as transaction fees or transaction bonuses
which are expressly permitted to be paid, but specifically excluding transfer taxes and
expenses reasonably related to the IPO) exceed $34,000,000. For purposes of confirming that
the total of such transaction fees and transaction bonuses of Astoria does not exceed
$34,000,000, EBG shall have a reasonable opportunity to review expenses that were deemed to be
reasonably related to the IPO.”



     (3) Section 4.1 of the EBG Disclosure Letter is hereby amended by deleting the following text:




“Permission to borrow at prevailing market interest rates available to the borrower up to $25
million to pay merger transaction expenses.”



     (4) Section 4.1 of the Astoria Disclosure Letter is hereby amended by deleting the second
paragraph thereof and inserting the following text in lieu thereof:




“In connection with the transactions contemplated by this Agreement, Astoria shall have the
right to pay transaction fees and expenses, including fees and expenses to Affiliates and/or
on behalf of EBG, in amounts not to exceed $59,000,000 (such $59,000,000 shall (i) include up
to $25,000,000 of expenses, costs and fees (including attorneys’ and auditors’ expenses, costs
and fees, if any) incurred by EBG in connection with the transactions contemplated this
Agreement, (ii) include up to $34,000,000 of expenses, costs and fees (including attorneys’
and auditors’ expenses, costs and fees, if any) incurred by Astoria in connection with the
transactions contemplated this Agreement and (iii) not include any fees and expenses in
connection with the public offering of securities contemplated by the Investor Rights
Agreement, which may be paid in addition to the expenses, costs and fees payable in (i) and
(ii) above). Astoria shall have permission to borrow at prevailing market rates available to
any borrower to pay such fees and expenses.”



     (5) Exhibit B to the Merger Agreement shall be replaced with the form of agreement attached
hereto as Exhibit II, which form of agreement shall constitute Exhibit B under the Merger Agreement
for all purposes.



     (6) Exhibit C to the Merger Agreement shall be replaced with the form of agreement attached
hereto as Exhibit III, which form of agreement shall constitute Exhibit C under the Merger
Agreement for all purposes.



     This letter agreement shall constitute an amendment of and waiver under the Merger Agreement
to the extent of the matters expressly provided for herein but shall not constitute a waiver of any
of the other rights, privileges or remedies provided for in the Merger Agreement,
which shall continue in full force and effect as amended hereby. This letter agreement shall be
governed by the laws of the State of New York.



* * * * *




 









 








     Please sign in the space provided therefor below and return to us a counterpart of this letter
(including by means of facsimile or electronic transmission), whereupon this letter shall
constitute a binding agreement among us.



	 	 	 	 	 
	 	Very truly yours,



EBG HOLDINGS LLC

 	 
	 	By:  	/s/ William Kriegel
 	 
	 	 	Name:  	William Kriegel 	 
	 	 	Title:  	 	 
	 
	 	US POWER GENERATING COMPANY

 	 
	 	By:  	/s/ William Kriegel
 	 
	 	 	Name:  	William Kriegel 	 
	 	 	Title:  	 	 
	 
	 	EBG MERGER LLC

 	 
	 	By:  	/s/ William Kriegel
 	 
	 	 	Name:  	William Kriegel 	 
	 	 	Title:  	 	 
	 
	 	ASTORIA MERGER LLC

 	 
	 	By:  	/s/ William Kriegel
 	 
	 	 	Name:  	William Kriegel 	 
	 	 	Title:  	 	 
	 



	 	 	 	 	 
	Acknowledged and agreed as of the date first written above:



ASTORIA GENERATING COMPANY HOLDINGS, L.L.C.

 	 	 
	By:  	 	 	 
	 	Name:  	 	 	 
	 	Title:  	 	 	 



 









 






	 	 	 	 	 




     Please sign in the space provided therefor below and return to us a counterpart of this letter
(including by means of facsimile or electronic transmission), whereupon this letter shall
constitute a binding agreement among us.



	 	 	 	 	 
	 	Very truly yours,



EBG HOLDINGS LLC

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	US POWER GENERATING COMPANY

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	EBG MERGER LLC

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	ASTORIA MERGER LLC

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



	 	 	 	 	 
	Acknowledged and agreed as of the date first written above:



ASTORIA GENERATING COMPANY HOLDINGS, L.L.C.

 	 	 
	By:  	/s/ Belinda Foxworth
 	 	 
	 	Name:  	Belinda Foxworth 	 	 
	 	Title:  	SVP & General Counsel 	 	 



 









 






	 	 	 	 	 




			
	cc:	 	Madison Dearborn Partners, LLC

Three First National Plaza

70 W. Madison, Suite 3800

Chicago, Illinois 60602

Fax: (312) 895-1051

Telephone: (312) 895-1000

Attention: Thomas S. Souleles and Patrick Eilers







			
		 	Kirkland & Ellis LLP

200 East Randolph Drive

Chicago, Illinois 60601

Fax: (312) 861-2200

Telephone: (312) 861-2000

Attention: Mitchell F. Hertz, P.C. and Richard J. Campbell, P.C.